The Nasdaq fell 2.9% on 30 October as technology earnings showed strong cloud demand alongside mounting cash demands from AI infrastructure investment. Financing disclosures extended the scrutiny to how developers fund that expansion and how banks, private credit investors and equipment suppliers share the exposure.

Energy risks linked market pricing to policy: the expiring December Brent contract reached its highest close since late April amid Gulf shipping concerns, while the Bank of Canada hiked as four central banks held. Binance’s theft tested exchange recovery capacity; UK and India policy changes raised questions about bank taxation, funding and credit allocation.

Read more on the week’s key developments:

1. Tech selloff tests confidence in AI spending and financing

The Nasdaq Composite fell 2.9% on 30 October as technology earnings renewed scrutiny of AI spending and cash returns. Alphabet’s search revenue grew 12% and Google Cloud revenue doubled, but capital expenditure pushed quarterly free cash flow to a $9.1 billion outflow. Amazon’s AWS sales grew 39.3% in the third quarter, while group free cash flow swung to a $42.4 billion outflow over the twelve months to September, primarily reflecting AI investment. Intel’s data-centre revenue rose 78%, although component shortages constrained supply and PC demand weakened.

Financing developments showed differing pressures. OpenAI reportedly cut its fundraising target from $30 billion to about $20 billion after investors reduced allocations. Oracle committed to limiting additional capital-market funding through fiscal 2030 to $20 billion, excluding refinancing and separate from its completed $20 billion equity raise. Banks and Blackstone committed financing for a $63 billion vehicle buying Broadcom equipment for lease to Anthropic. Broadcom is supporting the senior financing through a residual-value backstop with a maximum potential liability of approximately $43 billion upon deployment. It considers that liability unlikely to arise, citing expected customer profitability and equipment values.

2. Fed pauses after September hike as two members seek further tightening

The Federal Reserve held its target range at 3.75%–4% on 28 October in a 10–2 vote, following September’s unanimous quarter-point increase. Governor Lisa Cook and Cleveland Fed President Beth Hammack preferred another quarter-point hike. The committee upgraded its assessment of growth from solid to strong, while inflation remained elevated. Chair Kevin Warsh cited renewed increases in energy-related prices and the risk they could spread more broadly through the economy.

Warsh said September’s increase was beginning to tighten financial and credit conditions for some households and businesses, giving policymakers reason to assess more information before acting again. From 26 to 30 October, the two-year Treasury yield fell 12 basis points to 4.56%, while the 10-year declined 6 basis points to 4.94%.

3. ECB holds rates as Lagarde announces early departure

The ECB kept its three key rates unchanged on 29 October, with the deposit rate at 2.50%. September inflation rose to 3.8% from 3.2%, while third-quarter GDP growth slowed to 0.4% from 0.6%. Higher energy prices threaten to lift inflation even as they weaken growth. The ECB said it would set rates meeting by meeting.

President Christine Lagarde will leave on 7 February 2027, before her non-renewable term ends on 31 October 2027. She said she wanted “the freedom of speech, the freedom of expression, and the freedom to engage on matters that are not monetary policy matters.” Her tenure spanned the pandemic emergency bond-buying programme, rapid monetary tightening and the introduction of the Transmission Protection Instrument to address market fragmentation. Her departure brings forward the process to appoint a successor for an eight-year term.

4. Bank of Canada hikes as energy costs threaten broader inflation

The Bank of Canada raised its overnight rate by 25 basis points to 2.5% on 28 October, its first increase since July 2023. Inflation had been around 3% since April and was projected to reach about 3.5% by year end, while inflation excluding gasoline was 2.2% and core measures remained near 2%. The Bank expects growth of 1% in 2026, with excess supply persisting.

The Governing Council considered holding because core inflation was near target and the economy had slack. It raised rates because energy costs were feeding through fuel, transport, production and imported inputs, while businesses expected to pass on more of those costs. Governor Tiff Macklem said: “The longer energy prices remain high, the more likely it is these costs will spill over to consumer prices more broadly.” The Bank said another increase may be needed but would proceed carefully.

5. Brent reaches six-month high as Gulf shipping risks lift delivered costs

The December Brent contract, which expired on 30 October, settled at $117.64 a barrel, its highest close since late April and 13.6% above September’s close. The more-active January contract settled at $113.43. The late-month rise came amid concern over escalation in the Iran conflict; a tanker was hit by explosive devices in the Strait of Hormuz on 30 October. Separately, Qatar’s Nakilat said its LNG carrier Al Mayeda was struck by unidentified objects in the Arabian Gulf that day.

September supply indicators were improving: the US Energy Information Administration estimated Middle Eastern oil exports increased as production shut-ins eased to 4.8 million barrels a day from 5.8 million in August. But record tanker rates in September, reflecting higher insurance costs, added upward pressure to delivered crude prices for refiners, the EIA said. For banks, higher landed costs could increase energy importers’ working-capital needs and squeeze borrowers unable to pass them on.

6. HSBC falls on revenue miss as Standard Chartered rallies on upgraded outlook

HSBC shares fell 6% after revenue of $18.6 billion missed the $19 billion consensus. Reported pre-tax profit rose 32% to $9.6 billion, helped by the non-recurrence of prior-year legal provisions; excluding notable items, profit rose 10% to $10.0 billion on a constant-currency basis. Wealth fee and other income was flat at $2.7 billion as prior-year insurance gains did not recur and disposals weighed on revenue, although Private Bank fee and other income rose 16%, supported by mandates and trading. HSBC maintained its 2026 banking net interest income outlook of at least $46 billion and its return-on-tangible-equity target of 17% or better through 2028.

Standard Chartered shares rose about 8% after profit beat estimates and the bank raised its outlook. Pre-tax profit rose 27% as reported and 29% at constant currency to $2.25 billion, against a $1.99 billion estimate. Operating income grew 14% excluding notable items, ahead of 9% cost growth. Wealth Solutions income rose 26% at constant currency to $1.1 billion, driven by investment products and bancassurance, although management expects the usual seasonal moderation in Q4. Global Markets income grew 21%. The bank raised its 2026 income-growth outlook above 7%, from 5%–7%, and its RoTE outlook to around 14%, from above 12%.

7. Thailand holds at 1% as Japan’s lone dissenter seeks a hike

The Bank of Thailand held its policy rate at 1.00% unanimously. It expects growth of 2.4% this year and 2.1% next, below potential, while SME loans continue to contract even as larger companies borrow for working capital and investment. It expects inflation to average 2.1% in 2026 before easing to 1.3% in 2027, with oil prices, El Niño and business cost pass-through among the risks.

The Bank of Japan held its policy rate at around 1.25% in an 8–1 vote. The dissenter, Hajime Takata, sought a rise to 1.5%, arguing underlying inflation had reached the 2% target. The BOJ said real interest rates remain low and firms’ funding costs are low relative to profitability, while signalling further increases as activity, prices and financial conditions evolve.

8. UK raises temporary bank surcharge to help fund energy relief

The UK’s 28 October Budget raises the Bank Corporation Tax Surcharge from 3% to 6% for 15 months from 1 January 2027. The measure helps fund GBP 100 ($134) payments for up to 20 million eligible households in England and extended VAT relief on domestic electricity. The Office for Budget Responsibility put current-budget headroom at GBP 15 billion ($20.1 billion) in 2029–30, down GBP 7 billion ($9.4 billion), and forecast debt-interest spending GBP 12 billion ($16.1 billion) higher on average in the medium term than in its March forecast.

The surcharge takes the combined corporation tax rate on relevant banking profits from 28% to 31%; the GBP 100 million ($134 million) group allowance remains unchanged. Lloyds CFO William Chalmers said on 29 October: “We very much hope that yesterday’s tax increase is indeed a temporary measure.” The government plans to legislate a return to 3% from 1 April 2028 and says the increase will not be extended. The OBR estimates it will raise GBP 1.5 billion ($2.0 billion), allowing for GBP 190 million ($255 million) in lost receipts as some banks shift profits overseas.

9. Binance resumes withdrawals after $6.3 billion hot-wallet theft

Binance resumed withdrawals in phases on 1 November, three days after a hot-wallet breach forced their suspension; deposits remained open. It said it had replenished 95% of the approximately $6.3 billion in stolen tokens using its treasury, SAFU and part of its futures insurance fund. From 06:00 to 15:30 UTC on 1 November, net outflows reached $3.64 billion, or 2.1% of Binance’s reported $171 billion in assets. The exchange said withdrawals were stabilising and deposits remained substantial.

Binance said a compromised DevOps laptop may have exposed a service container, but reported no evidence of leaked wallet keys. Elliptic’s analysis indicates the attacker induced Binance’s transaction-signing infrastructure to authorise withdrawals. The FBI attributed the theft to North Korea’s TraderTraitor group. Elliptic counted $2.85 billion in stolen assets frozen or seized as of about 05:50 UTC on 1 November, largely through USDT and USDC freezes by Tether and Circle, alongside network-governance actions.

10. India launches six-month review of bank funding and credit rules

India constituted a high-level committee on 30 October to review how its financial system funds investment, including capital and funding across banks, development finance institutions and non-bank financial companies. The High Level Committee on Banking for Viksit Bharat, announced in the February Budget and chaired by former Central Vigilance Commissioner Suresh N. Patel, has six months to recommend reforms.

The review follows the Economic Survey’s assessment that banks dominate financing but are inadequately equipped to fund long-term infrastructure, energy transition and large manufacturing projects. Its remit includes business borrowing costs, priority-sector lending and safeguards for digital innovation and AI.

What to watch

Policy decisions and the US midterm elections set the week’s agenda. The Reserve Bank of Australia announces on 3 November; Bank Negara Malaysia and the Bank of England follow on 5 November.

In the US, Apple and Palantir report on 2 November, alongside the ISM manufacturing PMI. The ISM services PMI is due on 4 November and the October employment report on 6 November. The releases will test views on technology demand, AI returns and the path of Fed policy.

In Asia, China and India’s manufacturing PMIs are due on 2 November, followed by India’s services PMI on 4 November. Indonesia’s third-quarter GDP is due on 5 November, after 5.29% growth in Q2; Singapore’s banks report from 4–6 November.

Euro-area flash inflation and producer prices are due on 4 November, followed by retail sales on 5 November.